Utilities to recover costs of new capacity in Florida

15 October 2008

The Florida Public Service Commission (PSC) has approved the recovery from electricity consumers of the cost of uprating existing nuclear power reactors and the construction of two new plants in the state.

The proposed Levy plant
(Image: Progress)

The PSC voted on 14 October to allow Florida Power & Light (FPL) and Progress Energy Florida to recover the cost of planned reactors from customers through the 'capacity cost recovery charge' on their bills beginning in January 2009.

PSC chairman Matthew Carter said, "We are encouraging utility investment in nuclear electric generation today to ensure Florida's residents have reliable power for tomorrow." He added, "The legislature directed the commission to address nuclear construction costs annually, to spread the rate impact to customers over time and to reduce financial and regulatory risk that would otherwise prevent nuclear projects."

Upon PSC approval of a utility's need for a nuclear plant upgrade or new plant construction, the utility can petition for cost recovery under the new commission rule adopted in February 2007. The PSC approved FPL's plan to uprate its four existing reactors (two pressurized water reactors each at Turkey Point and St Lucie) in December 2007. On 18 March, it also approved FPL's plan to construct two more nuclear power reactors at Turkey Point. On 15 July, the PSC approved Progress' plans for a new nuclear power plant in Florida.

The PSC held the first annual nuclear cost recovery evidentiary hearings on 11 and 12 September, where commissioners heard testimony from utility companies, consumer groups, and the public. The PSC's decision was based on evidence developed during those hearings.

FPL will now be able to recover just over $220 million during 2009 for the uprate of its existing reactors at Turkey Point and St Lucie, as well as for two proposed new units at Turkey Point. The uprate projects and new units will add 2614 MWe of generating capacity. The new Turkey Point units 6 and 7, with a combined capacity of between 2200 MWe and 3000 MWe, are scheduled to begin operating in 2018 and 2020, respectively.

Meanwhile, Progress can now recover some $418 million during 2009 for the uprate of its existing Crystal River nuclear power plant and also its proposed new plant in Levy County. These projects would add a total 2380 MWe of capacity. Levy units 1 and 2 - both Westinghouse AP1000 reactor units - are expected to begin operating in 2016 and 2017, respectively. The company has bought 2060 hectares of greenfield land in Levy County, about 13 km from the Gulf of Mexico, and 16 km north of the existing Crystal River nuclear power plant. In early August, Progress submitted a combined construction and operating licence (COL) application to the US Nuclear Regulatory Commission (NRC) for a potential new nuclear power plant in Levy County.